Coinbase's Q4 earnings post record revenue and user growth

Coinbase surprised analysts by making nearly $2.5 billion in revenue last quarter, while its monthly active users grew to 11.4 million.

Coinbase's Q4 earnings post record revenue and user growth

Coinbase surprised analysts by making nearly $2.5 billion in revenue last quarter, while its monthly active users grew to 11.4 million.

Coinbase reported its highest-ever revenue figure, surpassing the $1.97 billion consensus estimate, as well as its highest-ever user count, reversing a recent decline that saw the company's users drop to 7.4 million in Q3.

Profits for Coinbase last quarter totaled $840 million, doubling the previous quarter's earnings, but still short of the $1.65 billion the company made in the second quarter of last year.

In October and November, when Bitcoin almost reached $70K, and frantic trading ensued, the impressive numbers were likely driven by a record high crypto price. Since the bear market has characterized 2022 thus far, they are unlikely to be repeated.

Coinbase's stock has been hovering near its all-time low since the company announced earnings last Thursday.

COIN shares closed at $169 in after-hours trading, a far cry from the over $400 it was trading for shortly after its debut last year.

In the Coinbase earnings, it was also shown that Ethereum lost its dominance over Bitcoin, falling to 16% trading volume share. Other assets, including Dogecoin, Shiba Inu, and so on, grew from 59% to 68% in volume.

Furthermore, Coinbase's earnings reflect that over $200 million of the company's revenue came from sources other than trading, such as staking and lending.

This still accounts for less than 10% of the company's overall revenue, yet it suggests that Coinbase is diversifying away from trading fees, on which it has long relied - and which many think are under pressure from platforms such as Robinhood that offer commission-free trading.

The company praised the growth of Web3, DeFi, and NFTs in its shareholder letter, suggesting that they would fuel future growth for Coinbase and the broader crypto industry.

During the earnings call, Coinbase also announced it has launched a number of new products in recent months, such as a tax center and a payroll center.

As of last fall, the service has not yet launched, despite the company's plans to launch an NFT marketplace with social media features.